Until very recently, The Bill and Melinda Gates Foundation’s brand of school reform was largely associated with the small schools movement. They spent $2 billion turning big, “obsolete” high schools into smaller “learning communities.” In November, faced with evidence of diminishing returns on the strategy, Gates hit Ctrl-Alt-Delete and rebooted their efforts, shifting the focus to higher standards for college readiness and improving teacher quality.

“We must give the Gates Foundation and its founders credit for their honest self-scrutiny,” wrote Diane Ravitch on Forbes.com. ”Most proponents of education reform defend their ideas against all critics, regardless of what evaluations show.” In Fortune last month, Claudia Wallis summarized the Gates Foundation’s new direction, the goal of which is to double the number of low-income students earning a college degree by 2025.

The upshot is that Education 2.0 is bolder and more aggressive in its goals, and it involves even more intensive investment – $3 billion over the next five years. This time the focus isn’t on the structure of public high schools but on what’s inside the classrooms: the quality of the teaching and the relevance of the curriculum. It steers smack into some of the biggest controversies in American education – tying teacher tenure and salaries to performance, and setting national standards for what is taught and tested.

“One of the reasons to think that the Gates 2.0 plan will be more successful than version 1.0 is that the plan involves a commitment to measure results and follow the evidence rather than plow forward with a preconceived notion like ‘small schools are better,” wrote Wallis.

Lessons Learned

“We saw that there is a big difference between graduating from high school and being ready for college,” said Gates in a speech at the Foundation’s November announcement. “In general, the places that demonstrated the strongest results tended to do many proven reforms well, all at once: they would create smaller schools, a longer day, better relationships—but they would also establish college-ready standards aligned with a rigorous curriculum, with the instructional tools to support it, effective teachers to teach it, and data systems to track the progress.” The defining feature of a great education, said Gates, is what happens in the classroom.

We’ve known about these huge differences in student achievement in different classrooms for at least 30 years. Unfortunately, it seems that the field doesn’t have a clear view on the characteristics of great teaching. Is it using one curriculum over another? Is it extra time after school? We don’t really know. But that’s what we have to find out if we’re going to not only recognize great teachers, but also take average teachers and help them become great teachers. I’m personally very intrigued by this question, and over the next few years I want to get deeply engaged in understanding this better.

Curriculum advocates, who often feel marginalized in ed reform debates about purely structural issues, were also cheered to hear Gates say “I believe strongly in national standards. Countries that excel in math, for example, have a far more focused, common curriculum than the United States does.” He also called for better use of data to drive instruction — and as the basis for merit pay. Gates, however, took pains to display a nuanced take on the potentially divisive issue.

There are two extreme sides in this debate. According to the caricature, one side just wants to turn teachers into commissioned salesmen, so their whole salary is based on how much the scores improve. The other caricature says that teachers don’t want to be held accountable, so they will reject any system that ties pay to performance. In truth, designing an appropriate incentive system is difficult, but possible. We believe in incentive systems, but we understand the concern that without the right design, they could seem arbitrary or incent the wrong things. They need to be transparent, they need to make sense, and teachers themselves need to see the benefits of the system and embrace them.

“The good news is that the Gates Foundation, with its vast resources, has pledged to devote its attention to what happens in the classroom,” concluded Diane Ravitch in her essay for Forbes.com. “The first thing it will learn is that there are no quick fixes. If it targets its dollars wisely, exercises a measure of humility, and continues to evaluate its efforts rigorously, it can make a positive difference.”